Florida workers’ comp fight goes to appeals court

Workers’ compensation insurance companies have gone to an appeals court after an administrative law judge last month backed a state proposal that would set payment amounts for inpatient care at hospitals.

Normandy Insurance Co., Zenith Insurance Co., Bridgefield Employers Insurance Co., Bridgefield Casualty Insurance Co., BusinessFirst Insurance Co. and RetailFirst Insurance Co. filed notices last week of taking the dispute to the 1st District Court of Appeal. The insurers have argued that a proposed rule issued last year by the Department of Financial Services’ Division of Workers’ Compensation was invalid.

The case centers, at least in part, on what are known as “maximum reimbursement allowances,” or MRAs, that help determine how much workers’ compensation insurers pay to hospitals for inpatient care. The proposed rule would lead to insurers paying $7,000 a day for inpatients who do not need surgery or intensive care; $11,000 a day for patients who need surgery; and $13,000 a day for intensive-care unit treatment.

Among other things, the insurers argued that the proposal was “arbitrary and capricious,” but Administrative Law Judge Darren Schwartz wrote in his March 9 order that the proposed rule was “supported by logic, the necessary facts, was adopted with thought and reason and is rational. … The Division (of Workers’ Compensation) conducted a thorough analysis of a variety of proposed MRAs and engaged in extensive negotiations and meetings with the carriers and hospitals.”

Several hospitals, the Safety Net Hospital Alliance of Florida and the Florida Hospital Association intervened in the case to support the proposed rule. As is common, the notices of appeal do not detail arguments the insurers will make at the Tallahassee-based appeals court.